I have gone through that notice. I don't like it very much and am little surprised. But, at the same time, we have to look at this in the overall context. The acquired business is not loss making, acquisition price isn't too steep seeing the incoming capacity; while business synergies can help improve profitability of the acquired company.
We need to remember that this management has not put a foot wrong since IPO. Mr. Punit Makharia is continuously buying from open market (last buy was around 225), so he is extremely bullish about the prospects of SP. Then, preferential allotment is coming as well. We need to see at what rates do they get the allotment. If this is around 200-210, i would be okay, as SP is pretty much rightly or rather slightly overvalued in comparison to its competitors. They want to increase the stake in the company without doubt. I will say, we need to keep hawk's eye, but at the same time need to ignore a few things which are rather immaterial. Otherwise, one will not be able to hold any company for long periods.
Related party acquisitions are always a question mark but it doesn't always mean it is mal-intentioned. I wouldn't have preferred this, but i am at least as of now not too much bothered.
Pref. allotment might be for further expansion into textile chemicals. Look at Bodal, where Mgmt was going for 8000 MT of dyestuff capacity in the first round which they increased to 12000 MT due to demand scenario. So, i believe, dyestuff segment is going to see better days ahead, and mgmt is trying to get the financial power to do that.